Power imbalances in French food retailing: Evidence from a production function approach to estimate market power

Stefan Hirsch and Maximilian Koppenberg

Economics Letters, 2020, vol. 194, issue C

Abstract: We analyze whether an association of firms to the dominant oligopoly of food retail groups is related to higher oligopoly market power. We apply a production function approach for the estimation of firm-level markups to a sample of 3,366 French food retailers over the period 2006–2014. The results suggest the presence of power imbalances between firms of the dominant oligopoly and fringe firms. We also detect a positive connection between markups and profitability pointing to a reduction in consumer welfare due to retailers’ oligopoly market power.

Keywords: Firm-level markups; Power imbalances; Production function approach; French food retailing (search for similar items in EconPapers)
JEL-codes: D43 L11 L13 L22 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:194:y:2020:i:c:s0165176520302433

DOI: 10.1016/j.econlet.2020.109387

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